Article published by IAAPA in the July/August 1997 issue of FEC Magazine

Putting the "Family" into Outdoor Fun Centers

by Randy White

Old thinking about outdoor fun centers threatens their future at a time when societal trends should position them to thrive. While Americans seek to cut back on work hours and spend more time with the family, most outdoor fun center owners are fooling themselves if they think they're designed to attract this growing family market.

Much of the blame lies with a formula that hasn't changed with the times. Outdoor family fun centers anchored with miniature golf were the predecessors of today's varied types of family entertainment centers. These outdoor centers started in California and slowly spread throughout the U.S. It wasn't until the late 1980s that new forms of FECs began to evolve, such as indoor family and children's entertainment centers and new outdoor variations.

The fun center formula -- miniature golf as the anchor, with some combination of go-karts, batting cages, bumper boats and a clubhouse with games, food and beverages -- began in the pioneer days. Back then, there was little competition. Demand for leisure activities exceeded supply. Guests had few options for community-based, out-of-home outdoor family leisure, so they didn't ask for too much.

Today, it's a much different story. Not only have new forms of FECs appeared on the scene, including children's entertainment centers and indoor FECs, but the location-based entertainment industry has exploded with urban entertainment centers, technology centers, theme-based restaurants and other venues, and entertainment-retail. Even old-time attractions, like bowling and museums, are re-making themselves to gain a greater share of family business.

Not only has the competition changed, but so has the customer. Gone are the yuppies of the 1980s, with their raging materialism and single-minded focus on career. As we approach the Third Millennium, Americans are changing priorities and placing less emphasis on materialism and more on experiences. This shift includes the desire for increased human connectedness -- including within the family -- and the desire for more quality leisure time.

A quiet revolt against the culture of getting and spending is well on its way. The Trends Research Institute of Rhinebeck, NY, has identified a phenomenon of choosing to earn and buy less, which they call Voluntary Simplicity or Downshifting, as one of the top trends of the '90s. A nationwide survey of Americans found that 28% had voluntarily downshifted and cut back on their income in some way over the last five years. Many of the downshifters were parents who had cut back on consumption to reduce working hours and gain time with their children.

Children and family exert a strong pull. Those Americans who have not downshifted feel more pressed for time, most saying they do not have enough leisure time, and that what they have is less than a few years ago. When asked what they feel guilty about neglecting, the largest number (80%) answered "their children." Similarly, when asked where they spend too little time, the largest number (54%) said "with their children." A Roper Starch Worldwide survey found that 65% of Americans feel that being with family is a very important aspect of leisure time.

It is clear, then, that as the downshifting trend picks up steam, the result will be more leisure hours that Americans will choose to spend as a family. Consumer demand for leisure experiences are expected to drive a steadily increasing percentage of consumer spending.

Now for the bad news. Just when societal trends are creating an incredible opportunity for FEC growth, the generic fun center formula is increasingly out of sync with society and losing market share to other location-based entertainment, including other types of FECs.

The Shotgun Approach Isn't Hitting the Target

If you'd asked the owner of an early outdoor fun center who he was trying to attract, the answer probably would have been, "Well, um, everyone." The early centers had a little bit of something for almost everyone and every socioeconomic/lifestyle group from working class to white collar, with motivations ranging from social interaction to competition to practice. Many FEC developers continue to follow this scattershot philosophy.

The problem is simple. Outdoor family fun centers don't satisfy the needs of families. While many believe that families include everyone from young children to grandparents, in terms of the FEC industry, the definition of "family" is children accompanied by parents. By providing a little bit of something for everyone, FECs in fact have driven away the very people on whom they hoped to build a profitable business.

No business can survive by trying to be all things to all people. Instead, it must create a unique value that it can deliver to a chosen market niche. A recent survey of 1,000 major companies confirms the wisdom of niche marketing. Of the 1,000, 75% reported efforts to appeal to smaller niche markets than in the past, and the companies in the smallest niche markets reported much higher returns on investment than those in broader markets. You only have to look at all the successful niche players in the retail, restaurant or hospitality industries to confirm this. For example, while much of the hospitality industry has lost money lately, the big winner has been one of the most focused chains, Marriott Courtyard.

Like these other industries, the FEC industry depends on repeat business to survive, which makes it a prime candidate for niche marketing. In today's competitive environment, you either satisfy a customer 100% or you probably won't see her very often or ever again. It's up to the business owner to excel in both defining the target customers and delivering an experience that meets their needs and exceeds their expectations. In industries where customers have choices, the only loyal customers are the 100% satisfied customers.

Delighting guests depends on selling more to fewer people rather than selling a little to a lot of folks who you can't hope to turn into repeat customers. This is called going after "share of guests" rather than share of market. It means focusing on a particular market segment rather than finding the lowest common denominator that will sort of appeal to everyone.

Delighting a market segment requires that you learn what is important to that particular group and how that group differs from others. Then you tailor or "customer-ize" the fun center -- its mix, design, operations and marketing -- to appeal to that specific segment. This takes research, starting with a thorough comprehensive market analysis. Without properly identifying the market segment and its needs, wants, and values, an outdoor fun center cannot be designed to attract it.

When you offer an in-depth assortment of attractions, programs and services tailored to please a narrowly defined segment of the market, the White Hutchinson Learning & Leisure Group of Kansas City, Missouri, calls that "focused assortment." It's kind of like shooting with a rifle instead of a shotgun. When you have focus, you know:

• who the guests are, both individually by demographic factors including age, gender, and socio-economics, and also by lifestyle factors including tastes, values and expectations;

• who they will bring with them -- their "affinity group;" and

• their motivators -- what leads them to visit.

As we'll see, the generic outdoor fun center formula is about as far from a focused assortment as you can get.

It'd Take a Strange Sort of Family to Enjoy the Typical Fun Center

The fun center formula was created to appeal to everyone. It's no wonder it has failed, especially when we look at the three elements that go into creating a focused assortment and see how the traditional formula measures up.

Knowing who the guests are. The problem here is that the fun center industry defines "family" much too broadly. For the fun center industry, a family should include children accompanied by their parents, and those children are toddlers through primary school-age. This runs against conventional wisdom, but it's true.

Identifying the affinity group. This one should be a no-brainer, but instead it's a major problem. Families with small children don't mix with bigger kids. Once they hit middle school, kids want to be with their parents only long enough to be dropped off at the skating rink or the mall. And by the time they're teens, kids want to be as far from adults and younger children as possible. Conversely, parents don't want to take small children to teen hangouts, and mothers in particular are intimidated by groups of teens. While teens and families are incompatible, the typical fun center tries in vain to attract them both.

Identifying the motivator. Again, the traditional fun center is trying to satisfy several motivators. Families are interested in social interaction, in feeling connected and passing the family's values on to the children. They want to create shared memories. Most fun center attractions, however, don't encourage family social interaction and have too narrow an age and gender appeal to satisfy the family unit.

A closer look at some typical fun center attractions tells the story: batting cages and golf driving ranges are for individual participants for practice; miniature golf requires skills and patience that young children don't have; go-karts and bumper boats have age limits on who can drive, although younger children may be allowed on as passengers; and arcades (non-redemption) appeal to males from middle school through adult and are competitive.

There is little for a child six or younger to do at the typical fun center, and the mix only partially satisfies grade school children. A bored child doesn't promote family interaction, and knocks a fun center out of the competition for most families.

Satisfying children six and younger is critical to any family destination. Most households with children have at least one child six or younger. In most suburban areas, more than 60% of families with children have at least one child six or younger, and more than 40% have a child four or younger.

Reaching young children also allows a fun center to capture non-peak attendance. During the weekday, business potential is generally limited to homemakers with children and child care visits. Although the majority of households have all adults working, in typical white-collar suburban areas more than 40% of children five or younger have an adult at home. Homemakers crave a location where they can mingle and interact with their friends while monitoring their preschool children at play.

How Fun Centers Can Win Back the Family Market

Clearly, the generic fun center formula has failed to attract families. Many fun centers are losing business to more specialized and focused location-based venues, including other FEC concepts. Fun center owners have two options:

1. continue with the original formula; or

2. evolve by focusing on a niche market.

Fun centers that survive into the Third Millennium will specialize. They can focus on older children, including teenagers, and adult males, or they can focus on families. There's nothing wrong with focusing on older children and adults, as long as that market segment is big enough and has enough spending potential. In most markets, however, the toddler to 9-year-old age group outnumbers children aged 10 to 17 by one-third and more. An added benefit is that the younger children come with their personal bankers -- their parents.

Winning back the family market will require fun centers to change their mix, presentation and operations. They'll target specific socio-economic lifestyle groups, catering to their values, needs and expectations. They'll stress security, because parents don't want to have to worry if they lose sight of the kids. The atmosphere and presentation will appeal, too, with bright, well-lit clubhouses and game areas flooded with natural daylight and seating areas that permit a normal level conversation. The game mix will be predominantly redemption, and videos will be non-violent. The grounds will be nicely landscaped, and there will be ample shade both for sitting and resting and for keeping the attractions out of the summer sun. Perhaps most importantly, the fun center will have fully integrated theming, including playful miniature golf courses with fun elements and obstacles that appeal to children, and themed go-kart tracks with two-seater karts with second "pretend" steering wheels like those made by FKL.

There will be rides like roller coasters produced by Wisdom Rides that allow the parent to ride with the child, and mazes that include theming and edutainment programming. Nature-based play gardens will meet the play needs of younger children with water and sand play, pretend play, forts and secret hiding places, arts and crafts, and live animals; and soft modular play equipment may be part of the mix, but it will be outdoors, where the whole family can stay together.

Specializing pays off. The White Hutchinson Leisure & Learning Group has worked with a number of fun centers that opened with the conventional formula. They changed to focus on the family market, sacrificing existing income from teenagers only to see their total incomes increase and hold, despite new FEC competition. They understand what the family market is all about.